Layer 2 refers to a secondary framework or protocol that is built on top of an existing blockchain system. Major cryptocurrency networks such as Ethereum face transaction speed and scaling difficulties. Bitcoin and Ethereum are still not able to process thousands of transactions per second. Additionally, these layer 2 solutions usually offer much better transaction fees.
Layer 2 solutions are designed to address the scalability limitations of the Layer 1 blockchain networks. By moving some of the computational and transactional processes off-chain while leveraging the security of the underlying Layer 1 network, Layer 2 solutions can significantly increase transaction throughput, reduce fees, and enhance the overall efficiency of blockchain systems.
There are two dimensions layer 2 is different from layer 1
first is transection execution and second is data availability
1) Transaction execution strategies deal with how transactions are run, where they are run, what the trust environments are, what the security and decentralization environments are, etc.
2) Data availability strategies deal with whether or not the Layer 2 solution makes their transaction data available on the main Layer 1 chain or not.
Types of Layer 2 Scaling Solutions:
- State Channel
- Side Chains
- RollUps Optimistic Rollups (ORs) Zero-Knowledge Rollups (ZKRs)
- Palsma
- Validiums
- Voliltions
While Layer 2 scaling solutions offer significant advantages, there are some considerations and challenges to keep in mind:
Security: Layer 2 solutions rely on the security of the underlying Layer 1 blockchain. Ensuring the integrity and safety
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